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Dana Point presents balanced operating budgets and multi‑year CIP, council asks for tech and performance metrics
Summary
Finance staff outlined proposed general‑fund operating budgets of $51.4 million (FY26) and $52.7 million (FY27), small structural surpluses, and a $14.9 million two‑year capital improvement program. Councilors emphasized technology investment, performance measures and customer‑service metrics.
Dana Point officials presented the proposed operating budgets and capital improvement program (CIP) for fiscal years 2025‑26 and 2026‑27 at the May 6 council meeting, reporting modest projected surpluses and fully funded reserves per city policy.
Administrative Services Director C. Shelton told the council general‑fund revenues are estimated at about $51.4 million for fiscal year 2026 and $52.7 million for fiscal year 2027, with expenditures of roughly $47.2 million (FY26) and $48.7 million (FY27) before transfers. After transfers, staff projected small surpluses — approximately $200,000 in FY26 and $100,000 in FY27 — and said the city’s unassigned fund balance would remain above the council’s 7% policy target.
Shelton highlighted major revenue sources: transient occupancy tax (TOT) projected at $17.4 million for FY26 (reflecting hotel reopenings and recovery), property tax projected at $12.4 million, and sales tax estimated at roughly $7 million. She said the FY26 budget assumes continued hotel operations and noted temporary closures or renovations that affected recent TOT receipts.
On expenditures, materials and services account for the largest share of general fund spending — in part due to the Orange County Sheriff’s Department contract, which Shelton identified as almost half of materials and services and budgeted at $16.6 million for FY26. Personnel costs were budgeted at roughly $12.4 million (68 full‑time positions), a net decrease from FY25 due to a one‑time CalPERS payment in FY25; ongoing personnel cost increases were described as driven by wages, benefits and pension costs.
The council also reviewed a two‑year CIP total of $14.9 million for FY26‑27 that includes ongoing road programs, the Doheny Village connectivity improvements, park facility upgrades and HVAC and roof work at City Hall and the community center. Shelton noted prior community investment funds were rolled into unassigned fund balance under a revised CIP funding policy.
Council members praised staff for the budgeting work and asked for additional emphasis on technology and performance metrics tied to the strategic plan. Several councilors urged staff to prioritize user‑facing process improvements (permitting, customer service) and measures that track time city records spend ‘at city hall’ versus time beyond staff control, so the city can measure and improve internal process efficiency. Shelton said technology needs are budgeted but staff may return with specific software or support requests as projects are firmed.
Next steps: staff will incorporate council direction and return June 3 for the budget hearing and adoption.
